When purchasing a home in Santa Clarita there are many things to consider. Single Family Residence or a Townhome/Condo? Valencia or Saugus? HOA or no HOA? But one thing many people have not heard of are Mello Roos.
What are Mello Roos?
Mello-Roos is a form of financing that can be used by cities, counties, and special districts (such as school districts). Mello-Roos Community Facilities Districts (referred to as “CFDs”) raise money through special taxes that must be approved by 2/3rds of the voters within the district. A CFD is formed to finance major improvements and services within the district which might include schools, roads, libraries, police and fire protection services, or ambulance services. The taxes are secured by a continuing lien and are levied annually against property within the district.
What is a CFD?
A Community Facility District (CFD) is set up by local government agencies as a means of obtaining community funding for public works, services, improvements and development. Funding is used for building parks, roadways, sewer, water storm drain, signage, street light, landscape and related improvements.
How long is the Mello Roos?
The length of the Mello-Roos tax varies in each subdivision. Fifteen years from the original build date is typical. The assessment very rarely extends beyond 30 years or is shorter than 7 years.
Where are there Mello Roos in Santa Clarita?
Not all but quite a few communities in Santa Clarita have Mello Roos. Most of the new developments in North of Copperhill such as Tesoro, West Creek, West Hills, and parts of the new Plum Canyon and Five Knolls communities. There are also a few in Canyon Country and Stevenson Ranch. Occasionally new developments won’t have them, such as the KB community in Plum Canyon. But, from what we have seen, when new communities lack Mello Roos, home prices tend to be higher.
How Can I avoid Mello Roos?
The only real way to avoid them is to not purchase in communities that have them in place. As we discussed earlier although they can be in place for 15 years, they can be extended for a longer period of time, and are rarely in place for less than 7 years.
If you’re in the market for a new home, or would like more information on what communities have Mello Roos, and how much they cost, contact us here, or call us at 661-373-2374.
